Securities Times: 

I have a question about the financial support for real estate policy. What specific policy measures will be taken by the financial department next to promote the sound growth of the real estate sector? Thank you.

Xiao Yuanqi:

Thank you for your question. In terms of facilitating the steady development of the real estate market, financial policy consists of a package of measures. In addition to my earlier introduction of efforts to further boost the financing mechanism for the urban real estate sector as well as the financial policies that were introduced by Ms. Tao, there are also a few other policies, which I will elaborate on in the following aspects.

First, we need to effectively leverage a combination of real estate financing tools, delivering integrated and large-scale effects and enhancing precision. There are many real estate financing tools available. In terms of banks, there are real estate development loans. By the end of September, the real estate development loans increased by over 400 billion yuan compared with the beginning of this year. Other types of loans include individual mortgage loans, commercial property loans, merger and acquisition loans as well as housing rental loans. The merger and acquisition loans refer to the loan support provided by banks for real estate project companies and property developers to acquire other assets. In addition, there is also bond investments. For example, financial institutions can invest in bonds issued by property developers and insurance companies can also use insurance funds for equity investments. Therefore, there are a variety of financing channels and tools available. We need to leverage the unique strengths of different financial tools, being that they are highly targeted and tailored to meet specific demands. Furthermore, in accordance with the types of property developers and real estate projects, financing efforts at different stages require individually tailored financial products, ensuring that the financing support is more targeted, timely and effective.

Second, we will collaborate with relevant government bodies to proactively explore specific supportive measures by both policy and commercial banks in putting idle land into better use. This is a set of integrated policies. As mentioned by my colleagues from the MOHURD, the MNR, the MOF and the PBC, these policies need to work in synergy to put idle land into better use. After consideration, we have allowed both policy and commercial banks to issue loans for the purchase of these idle lands at a certain proportion. The primary goal is to promote the more efficient use of these idle lands, while also improving and releasing cash flow in the real estate sector.

Third, the 16-step guideline issued by financial authorities in November, 2022 to enhance policy support for the housing sector as well as other policies concerning commercial property loans will be extended until the end of 2026. Moreover, mortgage rates for existing home loans and the down payment ratio of individual mortgage loans for both first and second homes will be adjusted. We will collaborate with the PBC to ensure the proper implementation of these measures.

Fourth, we will fully utilize financial institutions' expertise in information and financial management, offering property developers and real estate projects some specialized financial services, such as financial advisory and project design. We will assist these property developers and real estate project companies with strengthening asset liability management along with improving their financial stability and sustainability. That's all I have for now. Thank you.